Solution-What amount must the company borrow during february

What amount must the company borrow during february

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Question - Truck Company is preparing a cash budget for February (1^st month of business). The company expects to have $150,000 cash at the beginning of February and anticipates total February sales of $800,000, consisting of 25% cash sales and 75% credit sales. The company sets its selling price at 160 percent of the cost of purchases and pays for each month's purchases on cash at the end of the month. Other cash disbursements are $20,000 per month plus 4% of total sales. The Company has an agreement with its bank to maintain a cash balance of $100,000. What amount, if any, must the company borrow during February?

Reference no: EM133068039

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What amount must the company borrow during february

Reference no: EM133068039

Reference no: EM133068039

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